Boris Johnson has joined the lobbying effort to get British-based chip designer Arm to float in London, as the government fears the harm of losing to New York in the battle to lure high-profile tech companies looking to go public.
After the collapse of the $ 66 billion sale of the Cambridge-based business to US-based Nvidia earlier this year, Masayoshi Son, chief executive officer of Arm Softbank’s Japanese parent company, immediately snubbed the United United for a listing on the stock exchange.
“We think the Nasdaq stock exchange in the United States, which is at the heart of global hi-tech, would be the most suitable,” he said in February.
Johnson joined the lobbying efforts already underway by executives at the London Stock Exchange and numerous government departments and senior officials by writing a letter to Softbank executives, according to the Financial Times.
The effort includes the Department of Digital, Culture, Media and Sports (DCMS), the Treasury, the Department of Business and Downing Street. Digital Minister Chris Philp and Gerry Grimstone, the former president of Barclays who now heads the UK investment office, are leading the lobbying efforts.
While the chances of getting SoftBank to change its mind are considered slim, Arm already had a double listing on both sides of the Atlantic, before it was acquired by the Japanese company for £ 24.6 billion in 2016.
Arm had been a member of the FTSE 100 for 18 years and winning him back would have been a huge boost to the capital’s long-term ambitions to have more tech quotes, while losing him would have been a huge blow to that goal.
Analysts estimate that Arm would fluctuate with a market value of between $ 30 and $ 40 billion, making it the largest technology company on the London Stock Exchange, more than double its current leader, Ocado.
At that scale, Arm would also rank between the 19th and 24th largest listed companies in the UK.
A government spokesperson said: “We want to make the UK the most attractive place for innovative companies to grow and raise capital.” SoftBank, Arm and the LSE declined to comment.
In December, Paul Marshall, chairman of investment manager Marshall Wallace, said the UK and European equity markets were becoming the “Jurassic Park” of global exchanges.
He wrote in the Financial Times: “The UK stock market is becoming global stagnation as the US and Chinese markets advance. It has largely failed to take part in the global rally that began in 2015.
“We are reaching the point where companies may decide that we should just all agree on a single global exchange, negotiated around the clock and based in New York.”
New rules were introduced last year to try to make London more attractive to tech companies, including authorizing dual share class structures, which give founders more control after launching a business, and curtailment to 10 of the quantity of shares required to be offered to the public%.